On the 30th of November 2016, Mark introduced his Greens Private Members Bill - Petroleum and Geothermal Energy (Underground Coal Gasification) Bill 2016 - which bans the practice of underground coal gasification in South Australia.

The Hon. M.C. PARNELL: Underground coal gasification is one of those technologies that, having been embraced by various jurisdictions around the world, more often than not ends in tears. That is certainly the case in Queensland and it risks being the case here if we do not knock it on the head quick smart. What isat risk is not just our environment and public health but also our state finances. Underground coalgasification projects put out their hand for millions of dollars in state government subsidies, so thereis a lot at risk.

The process of underground coal gasification and the problems it caused I referred to insome detail in an earlier contribution back on 27 July, and I do not propose to repeat all the things Isaid back then. That motion on that day called on the South Australian government to follow the leadof their counterparts in Queensland and ban the practice of underground coal gasification in SouthAustralia. Having given the government a chance to take action itself, it seems clear that they willnot, which is why I have introduced this bill.

I want to briefly put on the record some things that have happened in this area since I lastspoke about this topic in July. On 1 September, the ABC reported that the Queensland governmentmay end up being liable for a $150 million class action over the Linc Energy UCG trial project, whichdamaged farmland near Hopeland on the Darling Downs. The ABC report states:

Solicitor Tom Marland said it was 'more than likely' Linc Energy's insurance policy would not cover the claim.

'If we're unable to find any fruit in relation to the insurance policies, we'll just endeavour to continue our actionagainst the State Government,' he said.

That shows that the risk might be well beyond just the immediate vicinity. It can also be a major hitto state revenue.

In a statement to the Stock Exchange on 14 October this year, Leigh Creek Energy said thatit was pleased to announce that 'environmental drilling [had] resumed at the Company's in-situ coalgasification project at Leigh Creek, South Australia', and it was anticipated that drilling would finishin five weeks' time. I think the phrase 'environmental drilling' is the mining industry's equivalent of'friendly fire' because there is nothing of benefit to the environment in underground coal gasification.

On 8 November, the Queensland government introduced legislation into parliament to banunderground coal gasification. This was something that had been foreshadowed earlier, in fact thepolicy had been announced on 18 April. The Queensland government's Department of NaturalResources and Mines website states:

…the Queensland Government introduced legislation into the Parliament which seeks to place a moratorium on all future activities relating to UCG through the Mineral Resources Act 1989. The moratorium will also apply to the in situ gasification of oil shale.

It goes on:

After careful consideration of the results of these trials, the Queensland Government concluded that thepotential impacts of UCG activities and the issues associated with the trial projects to date, the risks associated with allowing future commercial-scale UCG operations are not acceptable and currently outweigh the foreseeable benefits.

There are many parallels to the debate that we had before the dinner adjournment in relation tounconventional gas. Whilst this is a very different process we are talking about, underground coalgasification, you will see that many of the same themes emerge.

On 14 November this year, the ABC reported that an increasing number of mining executiveswere being charged with criminal offences. The report states:

The Queensland Government has charged five former executives of Linc Energy with environmental offences over the failed company's alleged contamination of huge swathes of prime farmland in the state's south-east.

They are: Peter Bond, who is facing two further charges since September; Donald Schofield, formerLinc Energy general manager, on two charges; Stephen Dumble, former chief operating officer, ontwo charges; Jacobus Terblanche, former chief operating officer, on one charge; and Daryl Rattai,former general manager, on one charge.

At this point, I note that none of those listed executives who are facing charges are, in fact,executives or directors of Leigh Creek Energy, or its predecessor, Marathon Resources. The pointthat I make is that it is a company that was undertaking exactly the same activity that Leigh CreekEnergy now seeks to undertake. The ABC report continues:

The ABC revealed last year that a Queensland Government investigation found hundreds of squarekilometres of prime agricultural land was at risk from a cocktail of toxic chemicals and explosive gases that had allegedly seeped from Linc's UCG site.

The multi-million-dollar investigation was the largest in the Queensland Environment Department's history.

It found that soil near the facility had been permanently acidified, with methane, hydrogen, carbon monoxide and hydrogen sulphide alleged to have leaked from the site.

These are not claims or allegations being made by me. This is the Queensland government, havingundertaken the largest ever environmental investigation in its history, and it is all to do withunderground coal gasification.

On 18 November this year, Leigh Creek Energy made another statement to the StockExchange and in it they refer to all the public subsidies they are going to be receiving—the publichandouts. According to the statement:

Australian Government determines the Leigh Creek Energy Project eligible for Research and Developmenttax offset

The total estimated eligible expenditure is $21 million. The statement also says that the companywas applying for South Australian government PACE grants to accelerate investment in gas projects,and they point out that the maximum application amount is $6 million.

It is a risk to the environment, a risk to health, a risk to taxpayers from the liability of havingto fund damages claims, and also a direct hit to our state budget as we hand money to thesecompanies in the form of direct grants or tax offsets. That brings us up to the present. I refer to acomment made by the Hon. Tom Koutsantonis in that important journal of record, TheTranscontinental newspaper. The article states:

State Energy Minister Tom Koutsantonis said the approval or otherwise of coal gasification projects shouldbe based on science and determined by 'expert regulators, not politicians'.

The direct quote from the minister is:

Politicians are not qualified to make these assessments. We trust the scientists and independent regulators, and proponents need to prove to these regulators that they will do no harm to the environment.

Let's find an independent regulator and hear what they have to say to help us make the assessment.That brings us to Scotland. A month ago, Scotland banned underground coal gasification. It did sofollowing an independent report which evaluated the technology and the global experience ofunderground coal gasification. The author of that report was one Professor Campbell Gemmell, whomembers would realise is the former chief executive of South Australia's own EPA.

When I found out about the Scottish government decision and I found out about the report, Icontacted Professor Gemmell in Scotland, and, as it turned out, he was coming back to Australia inNovember for a holiday and to do some consultancy work for the Victorian EPA. So, I ran past himthe idea that if he happened to be in Adelaide on a sitting day, he might see his way clear to providinga lunchtime briefing to members of parliament. I was delighted that it turned out that he was able todo it, and he gave that briefing to members on Tuesday. A number of members attended. For thosewho did not, I am happy to circulate his PowerPoint presentation, because it is quite telling.

It is entitled 'A review of underground coal gasification for Scottish government', and hehighlighted the main messages and offered some lessons for South Australia. After describing howthe underground coal gasification project works, he described the parameters of his study.Effectively, he looked at this industry everywhere in the world that it had been carried out. As well asthe global literature review, they interviewed 35 people from 23 stakeholder bodies and they madesure they talked to industry, community regulators and also NGOs. They also had the ability to relyon some other independent European scientific work that had been done.

The professor described how he had looked at projects in Australia, Belgium, Bulgaria,Canada, Chile, China, England, France, Germany, India, Japan, Mongolia, New Zealand, Pakistan,Poland, Russia, South Africa, Spain, Tanzania, Ukraine, the USA and Uzbekistan. As it turns out, itis only Uzbekistan where the project has lasted any period of time. Just about all the other projectsfailed within a very short period of time. Some went for a few weeks, but only Uzbekistan has beengoing for any significant time. I understand it is about 50 years that that project has been going.

Maybe it is to do with the regulatory regime in Uzbekistan, but the professor found it verydifficult to find information about any environmental monitoring that had been undertaken. Havingdone all that work, the results of the professor's independent study showed that there were very fewcases where the results of the underground coal gasification had been written up, there were nopublished environmental licences that were available, and there was very little verified, peerreviewed, or openly-reported performance data. In other words, it was an incredibly secretiveindustry.

What he did find was evidence of significant performance failures, and these included:surface, groundwater and land contamination; containment losses; fugitive methane emissions;seismicity; inadequate liability management; and worker health issues.

The results also showed that one of the inevitable consequences of setting fire to a coalseam under the ground is that, once that coal seam has burnt out, a cavity remains and those cavitieshave a habit of collapsing, so subsidence was a serious issue in many of the examples.

The approach that Professor Gemmell took was that he thought there were fiveconsiderations that needed to be taken into account before you could go ahead with something likeUCG. He looked at the impact on climate and found that it was overwhelmingly negative becausethere is no capture of fugitive emissions and no offsets. He pointed out that public or communityconsent was essential, and that brings us back to the debate we have been having on fracking. Hesaid that did not exist in Scotland.

You have to look at the operators. Are they credible? Are they competent? Are they fit? Arethey using the best available technology? You need to look at the regulation. Is it a clear system? Isit coherent? Is it effective? Is it robust? You also have to look at long-term issues, not the least ofwhich is post-mining closure. What do you do once you have finished extracting the gas? How doyou put out the fire? Does putting out the fire stop the gasses from coming to the surface?

His conclusion was that these tests could not be met in Scotland. He points out that, whereit has been tried in Australia, it has led to prosecutions. The operators exit. They exit leavingcontamination behind and the state is left to pick up the tab.

The activity of underground coal gasification has been banned, as I said, in Scotland. It hasalso been banned in Wales, France, Germany and, most recently, Queensland, and the questionbefore us in this bill is: should it be banned in South Australia as well? The professor basically leftthat decision to us, as is appropriate, but, having put all that information on the table, I think it is prettyclear that he has not found too much to recommend this industry.

Let's take Minister Tom Koutsantonis at his word. He wants to hear from independentregulators. I have found one for him who was the top regulator of the environment in South Australiauntil fairly recently. He has handed down his verdict and I think that mining Minister Koutsantonisneeds to pay close attention to it.